AI's Investment Implications


#622

3 Chip Stocks to Buy for the Next 3 Years

INTC
MU
NVDA

Wonder why don’t include AMD. According to manch, AMD, MU and NVDA are the AI tripod.


#623

Softbank is dumping its NVDA shares.


#624

This article is sponsored by Softbank? Refer to earlier post, chart indicated could (not guaranteed) drop below $100.


#625

https://www.bloomberg.com/news/articles/2018-12-11/softbank-is-said-to-plan-sale-of-stake-in-nvidia-next-year

SoftBank Group Corp. is planning to offload its stake in Nvidia Corp. early next year as shares in the graphics chipmaker continue to slide, according to people familiar with the matter.

The Japanese investor could make about $3 billion in profit from the trade, said the people, who asked to not be identified because the matter isn’t public. No final decision has been made and SoftBank may opt to keep its stake or sell only part of it, the people said.


Nvidia Bombed. Anyone Buying?
#626

Collar :slight_smile: Sell OTM call to buy OTM put. I can do because I don’t even have 100 shares :slight_smile:


#627

While demand in the memory chip market is forecast to slow, demand from datacenter, IoT, autonomous driving and AI markets will remain big growth markets for the next three to 10 years.

True or false?

Normally, these supply ramps last two years, and cause earnings per share at Micron to drop $4 during that stretch. Earnings this year (fiscal 2018) are expected to peak around $12 per share. Thus, history says that earnings will shake out around $8 per share by fiscal 2020.

True or false?

When it comes to chip stocks, the reason to own them for the long haul is to gain broad exposure to multiple data-centric markets that are currently nascent but oozing with hyper-growth potential. These markets include data-centers, IoT, AI, automation, and AR/VR.

True or false?

Just look at the markets Nvidia is servicing. The global data center market is expected to grow by somewhere between 10% and 20% over the next several years. IoT is projected to be a 25%-plus growth market over the next several years. Autonomous driving is pegged as a 40% to 60% annualized growth market over the next several years. IDC thinks the AR/VR market will grow at a 50%-plusrate over the next five years.

True or false?


#628

That bust is obvious in Nvidia’s revenues this year: they are essentially flat for three quarters now, hovering between $3.1 and $3.2 billion.

Almost 20% of Nvidia’s $9.7 billion in revenue last year came from China. Many of its chips are used there for assembly into other products, and it has invested heavily to tap China’s burgeoning AI industries.

When it comes to owning next-generation application workflows, Nvidia is facing robust competition from startups and established players who want access to this potentially gigantic market. Even its potential customers are competing with it. Facebook is reportedly designing its own chips, Apple has been doing so for years, Google has been in the game a while and Amazon is getting into the game fast. Nvidia has the know-how to compete, but these companies also understand the nuances of their applications really, really well. It’s a tough market position to be in.

CAN’T MAKE CONSECUTIVE 3 POSTS. So have to edit this post.
Time to buy MU on an auspicious day 1228?

Dram prices are increasing AGAIN.


#629

This guy’s analysis says yes.

Comparing Micron Technology To Its Memory Competitors In Q4 2018 And CY 2019 $MU

https://seekingalpha.com/article/4230365


#630

What is your opinion? Don’t be shy to share :grin:


#631

I agree with the SA guy. He said something that’s very true. Because the DRAM market is now controlled by 3 companies, they seem to share some consensus not to tank the price by oversupply. All 3 will cut capex spend that both boosts price and cuts spending, so the bust won’t hurt profitability all that much.

The old bust cycle is now much shortened because of the concentration of market power.


#632

Buy buy buy!?


#633

The whole market is like a candy store now. You will do well no matter what you buy. :smile:


#634

What stocks are you holding now?


#635

Amazon 10c xilinux and Twilio. Waiting for wash sale periods to expire to buy others.


#636

No more chips and FB? Worse, no AAPLs!!! Dividends + growth, best of both world.


#637

After a two-year boom in the market, oversupply is weighing on DRAM and NAND flash chip prices amid weak consumer and business demand for phones and computers. Weaker memory demand than expected is causing a supply excess, resulting in falling memory chip prices.

However, I pointed out in my previously mentioned Seeking Alpha article that semiconductor market conditions will start improving from the second half of 2019 at the latest.

The oversupply of memory chips is resulting in decreased average selling prices, but price erosion will improve in Q4 2018 for NAND and Q1 2019 for DRAM.

Although chip prices are dropping, bit growth of the memory chips is resulting in high revenues and margins for manufacturers.

Although demand for smartphones is flat, and capex spend for cloud servers is slowing, increased memory content per device is growing strongly.

Sound like he is saying wait for next earnings before nibbling. Action now: Monitor


#638

Stock market looks forward. It seems MU is finding a bottom around $30? I will monitor it for a few more weeks.


#639

Micron: A Major Opportunity Trading At Book Value

Micron Technology is now trading just above tangible book value.
I’m a buyer at this price level. There’s clearly a huge potential opportunity here but also a lot of uncertainty around timing.

So, what this article focuses on is managing risk while getting exposure to what could potentially become a $100+ stock under the right conditions.

I see $100 after the dust settled.

Historically, Micron stock bottoms around the same time that revenue growth bottoms, and that may still be a couple quarters out based on the CEO’s DRAM demand/supply prediction and the visible price trend

That is what the other seeking alpha guy is thinking, buy then. Main risk is China, can they produce high quality DRAMs at lower price than MU?

Micron: Where’s The Bottom?

The bottom line is that barring any major surprise out of the 90-day trade talks, Micron’s stock price may see a bottom around $25 in the first quarter of 2019.

If it is not bottom yet, my take is $21 is the bottom.

Micron: This Ain’t 2016

In theory, the better-functioning supply side and diversified demand drivers should make the current cycle a bit shorter than the past – we’ll see if that happens. Neither side has been proved as of yet.


#640

Last qtr they revised 3 times estimates (IIRC), and forecast they admitted demand is reducing. Perfectly right at $20s as memory chip demand is reducing.

I just reviewed semi-conductors like MU, NVDA, KLAC and LRCX.
Looks to me, both KLAC & LRCX are better dividends above 3%. I would prefer these two than MU & NVDA.
This is just preliminary scan and yet to analyze more (as I have sufficient time before the hit low end).
What is your (and manch) take about KLAC & LRCX?


#641

China won’t be able to make high quality data center grade DRAM for many years to come. No need to worry about that. NAND which is less advanced China is nibbling at people’s heels. But Trump is waving a Cold War against China. China won’t get the advanced machinery to make leading edge chips. That will further push back China’s progress.

The main Chinese threat is that micron may get singled out for punishment because it’s American. The other two manufacturers are Korean and a lot friendlier to China.

Semi equipment like Lam is like a derivative option of semi makers like micron. It can go higher but also can sink lower.